The cost of consumer switching among retailers and other providers is estimated at $1.6 trillion. Yet 80% of “switchers” think their original provider could have done something to retain them.
Many companies think of innovation in terms of products, internal processes (like supply chain management), and business model innovation. But far fewer consider innovation in customer service. Even companies that have a strong balance of human-centric and automated customer service options may only think in terms of improvement and critical KPIs rather than disruptive innovation of customer service.
The good news is that innovation management in customer service presents an enormous opportunity for those companies that are willing to seize it. Companies that excel with customer experience have revenues at 4% to 8% above their market. Here’s how to unleash innovation in customer service and reap the rewards.
An “Outside-In” Viewpoint Is Necessary
Around three-quarters of businesses say their top objective is improving customer experience, but how can they do that beyond fine-tuning and improving existing processes? Innovation management is necessary, and it requires that companies first look at themselves from an outsider’s (their customer’s) viewpoint.
This major shift in perspective may lead to doing things that competitors haven’t even thought of, such as eliminating “friction points” by streamlining and simplifying how customer pay. It’s hard to develop true customer service innovation from an “inside-out” viewpoint. You have to see your company as your customers do and learn what it is they really want – not necessarily what you can easily accomplish through improved processes.
Prerequisites to Innovative Customer Service
Before you can deliver innovation in customer service, you must already be at a certain functional level of providing strong customer service. Some of the prerequisites to innovative customer service include:
- Understanding customers as humans
- Knowing the audience on as detailed a level as possible
- Setting high standards and committing to achieving them
- Thinking beyond KPIs
- Helping customer service employees develop into true brand ambassadors
- Committing to continuous improvement
- Being willing to do things differently
- Accepting feedback and really listening to it
Just as you wouldn’t try to build a beautiful house without laying a strong foundation first, you shouldn’t attempt customer service innovation unless you have a strong, foundational understanding of your customers first.
Don’t Mistake Improvement for Innovation
Improvement is good, and commitment to continual improvement will always be an honorable business goal. But improvement and innovation are not the same. Innovation turns conventional wisdom on its head and forces us to look at things from a completely different direction (the customer’s, in this case).
Innovation doesn’t eliminate the need for improvement, but improvement won’t lead to innovation unless there are commitment and excellent innovation management tools available. Being a game-changer requires a thorough understanding of the game, but it also requires a keen understanding of the context of the game. With customer service, that context is usually some variation on the axiom that what customers ultimately want is a solution to a problem. Listen to them, and they may spark innovative ideas that you can use to disrupt customer service in your industry to both their benefit and yours.
If you are among the 75% of companies with the goal of improving customer service this year, maybe you can set your sights on innovation rather than just improvement. IdeaScale invites you to subscribe to our newsletter for regular news and information about the latest in innovation management.